An excerpt from a recent op-ed by Robert W. van Zwieten, President and CEO, EMPEA

The newsflash in the Wall Street Journal last week that the Saudi government has decided to rethink its "multi-billion dollar U.S. financial strategy" as well as the possible New York listing for the partial IPO of Saudi Aramco in 2018 is the first public marker of a trend we have observed in private conversations in the Middle East going back to March this year: many senior decision-makers in the Middle East are concerned about the political risk posed by the incoming Trump Administration in the United States, and have begun to make important financial decisions informed by their assessment of that political risk.

Previously, I highlighted this trend in the thinking of regional institutional investors in our LinkedIn contribution titled "President-elect Trump and Emerging Markets Private Capital: Eight “Big Picture” Ramifications for the Industry" published on November 23, 2016. Back in March many institutional investors in the region had just gone underweight on U.S. assets and were looking to inform themselves more deeply about investment opportunities in emerging markets. We can now add the most senior government officials in Saudi Arabia to the group of influential decision-makers in the Middle East who have turned weary of the United States when it comes to their financial interests.

This past year we have welcomed over 360,000 visitors to our online resources at EMPEA.org, had our industry-leading research downloaded more than 7,890 times, featured over 340 thought leadership contributions from our membership, received direct data contributions from more than 225 Member Firms and engaged over 190 Members on leadership Councils. Find out more about how we have expanded our activities to strengthen every Member’s potential by cultivating relationships and providing the intelligence needed to navigate a challenging global landscape.

Global private equity firm Warburg Pincus has reached a final close for Warburg Pincus China with US$2 billion in capital commitments. Investors in the fund include public and private pension funds, sovereign wealth funds, insurance companies, endowments, foundations and high-net worth individuals. The Washington State Investment Board reportedly committed US$200 million to the fund, which also received commitments of US$100 million from the New Jersey Division of Investment, US$75 million from the State Teachers Retirement System of Ohio and US$50 million from the Minnesota State Board of Investment. The fund is a companion vehicle to Warburg Pincus Private Equity XII, which reached a final close in 2015 with US$13.4 billion in commitments.

Amandi Energy, a project development platform backed by Endeavor Energy and Aldwych International, has arranged US$552 million in financing for the construction of a 200 megawatt combined-cycle, dual-fuel power plant in Ghana. Endeavor and Aldwych are in turn backed by energy and infrastructure-focused private equity firms Denham Capital and Harith General Partners, respectively. The financing package includes US$134 million in equity provided by Endeavor, Aldwych, Amandi’s founders, Harith-managed Pan African Infrastructure Development Fund 2 and the ARM-Harith Infrastructure Fund, a joint venture between fund managers Asset & Resource Management Company and Harith. Development finance institutions Overseas Private Investment Corporation (OPIC) and CDC Group, Nedbank and Rand Merchant Bank provided US$418 million in debt financing for the project, with OPIC and CDC committing US$250 million and US$83 million, respectively. Amandi Energy will sell power to the Electricity Company of Ghana under a 25-year power purchase agreement.

United Arab Emirates-based ride-hailing company Careem has raised US$350 million in a round led by Japan-based e-commerce and internet company Rakuten and telecom operator Saudi Telecom Company. Global growth markets investor The Abraaj Group; venture capital firms Wamda Capital, Beco Capital, Endure Capital and Lumia Capital; asset manager SQM Frontier Management and a series of corporate investors also participated in the transaction, which represents the first tranche of a larger financing round expected to total US$500 million. Careem will use the new capital to scale up its transport services in existing and new markets and accelerate innovation across its platform of high-frequency transactions.

Middle East-focused alternative asset manager Gulf Capital has reached a final close for its second private debt and mezzanine fund, Gulf Credit Opportunities Fund II, over its target of US$250 million in capital commitments. Investors in the fund include sovereign wealth funds, international institutional investors, regional insurance companies, foundations and family offices. Development finance institution International Finance Corporation committed US$25 million to the fund, which will invest across the Middle East, Turkey and Africa and focus on defensive sectors such as health care, education, industrials, power, water and oil and gas.

Private equity firms One Equity Partners and TRPE Capital have agreed to sell their 48 percent stake in Turkey-based ICT services provider Netas Telekomunikasyon to China-based telecommunications and IT equipment manufacturer ZTE International for US$101 million, plus performance earnouts. One Equity Partners originally invested in the company in 2010 through OEP Turkey Tech, a vehicle advised by TRPE Capital since 2012. The transaction is expected to close in January 2017.

Aspada Advisors, an investment firm focused on small and medium-sized enterprises in India, has invested in India-based post-harvest agriculture value chain service provider Arya Collateral Warehousing Services. Aspada invested through Aspada Investment Company. Arya will use the new capital to scale in primary markets with low warehousing penetration and availability of finance for post-harvest storage of commodities. Financial details of the transaction were not disclosed.

China-focused private investment firm Primavera Capital Group has reached a final close for its second U.S. dollar-denominated China-focused fund with US$1.9 billion in commitments, surpassing its US$1.5 billion target. Investors in the fund include Pennsylvania State Employee’s Retirement System, Taiwan Semiconductor Manufacturing, the Second Swedish National Pension Fund, China-based Taikang Insurance Group and Finland-based Varma Mutual Pension Insurance. Primavera focuses on growth capital, buyout, restructuring and turnaround investments.

CGN Private Equity Fund Management Company has reached a third close for CGN Capital Partners Infrastructure Fund III with CNY3.3 billion (approximately US$478 million) in commitments. Investors in the fund include Industrial and Commercial Bank of China, Agricultural Bank of China, Post Savings Bank of China, China Cinda Asset Management, China Huarong Asset Management and People’s Insurance Company of China. Three Gorges Capital, a unit of state-owned power company China Three Gorges Corporation, committed CNY100 million (approximately US$14 million) to the fund as part of the third close. The fund plans to invest in operating assets in China’s wind, hydro and solar power sectors and is targeting a CNY5 billion (approximately US$724 million) final close in the first quarter of 2017.

South and Southeast Asia-focused private equity firm Creador Capital has reached a final close for its third fund with US$415 million in capital commitments. Investors in the fund reportedly include global private markets asset managers and advisors Hamilton Lane, Siguler Guff & Company and Hermes GPE. The fund will invest in consumer-oriented businesses in Indonesia, Malaysia, Singapore, the Philippines, India and Sri Lanka.

German development finance institution DEG has arranged EUR66 million (approximately US$69 million) in debt financing for Turkey-based household goods and hygienic products manufacturer Hayat Kimya Sanaki. Co-financers include emerging markets-focused private credit fund manager Cordiant Capital, the Development Bank of Austria (OeEB) and the Black Sea Trade and Development Bank (BSTDB). DEG provided a long-term loan of EUR25 million (approximately US$26 million) to Hayat as part of the financing package. The company will use the new capital to fund its new production line for nonwoven fabrics in Egypt and has already invested in new production lines at its Turkish manufacturing complex.

MENA-focused venture capital firm Algebra Ventures has reached a first close for its new technology venture capital fund with US$40 million in capital commitments. Investors in the fund include Cisco’s corporate investment arm Cisco Investments and the Egyptian-American Enterprise Fund, an investment fund backed by the United States government, as well as development finance institutions European Bank for Reconstruction and Development and International Finance Corporation, which each committed US$10 million. The fund, which is targeting US$50 million in total commitments, will invest in technology-enabled start-ups in the fintech, e-commerce and consumer internet sectors.

Frontier markets-focused private equity firm InFrontier has reached a first close for InFrontier Afghanistan Fund with US$22 million in capital commitments. Investors in the fund include development finance institutions CDC Group, which committed US$15 million, and the Dutch Good Growth Fund. The fund is targeting a final close in 2017.

The Toolkit is a highly valued and free-to-use, publicly available resource for fund managers that are proactively addressing how to factor ESG considerations throughout the investment cycle.

The Toolkit aims to be both a practical building block for the development of a customised ESG management system, and an easy-to-use reference guide for assessing and managing ESG risks, impacts and opportunities. The new web-enabled version, released in June 2015, is designed to be more accessible, easier to navigate and thoroughly cross-references other industry guidance. It is also regularly updated as practices and standards evolve.

The PRI has developed this short video (less than 15 minutes) to demonstrate exactly how PRI signatories can use the Toolkit to best effect when developing their own approaches to responsible investment in private equity.

African Development Bank is hiring for the position of Associate Research Officer who will be part of the Knowledge Management Team and will be responsible for conducting research on developments in the African financial sector, providing content for the Partnership’s website and newsletters.

For more information, including responsibilities and qualifications, please click here.

About EMPEA

EMPEA is the global industry association for private capital in emerging markets. We are an independent non-profit organization with over 300 member firms, comprising institutional investors, fund managers and industry advisors, who together manage more than US$1 trillion of assets and have offices in more than 100 countries across the globe. Our members share EMPEA’s belief that private capital is a highly suited investment strategy in emerging markets, delivering attractive long-term investment returns and promoting the sustainable growth of companies and economies. We support our members through global authoritative intelligence, conferences, networking, education and advocacy. For more information, visit empea.org.